Higher Education Finance Issues in a Period of Transition. Working Papers in Education Finance, No. 3.

Schmidtlein, Frank A.; Popovich, Joseph J., Jr.

Trends affecting postsecondary education finance, including declining enrollments, are considered, including: demographic changes, changes in student enrollment rates, fundamental shifts in the economy, and the changing social priority assigned to postsecondary education. Major demographic trends that have major implications for postsecondary education are a birth rate decline, fewer persons of traditional college age, and an aging population. Two dilemmas will confront higher education as enrollment-driven revenues for many institutions level and decline: new bases for justifying budget increases will be needed, and migration and population growth patterns will result in some campuses growing, some remaining stable, and other contracting, often within the same state. Changes in participation in higher education are analyzed by student sex, race, age, part-time enrollment status, income level, and ability level; by type of academic program; and by type of institution (public, private, and proprietary sectors). Economic trends affecting revenues available for postsecondary education include inflation, the scarcity of energy and natural resources, a growing competition for funds, the cost of higher education, productivity, and shifting sources of revenues. Social trends include views on the economic value of higher education and the production of advanced degrees. Contemporary trends will also affect the following goals of postsecondary education: access, diversity, quality, and economy. (SW)